Finance Minister Magnus Brunner defended the government’s measures that aim to tackle the above-EU average inflation rate in the country amid growing criticism on Monday.
To face growing inflation, which reached a very high rate of 9.1% in March, the government implemented countermeasures often criticised for lack of accuracy or for subsidising too much.
Compared to the rest of the Eurozone, Austria is proportionally the least likely to use price-effective measures, an analysis by the Momentum Institute based on data from the Belgian think tank Bruegel showed. The government has so far mainly relied on measures such as support payments and has only intervened directly in prices with the electricity price cap.
However, Finance Minister Magnus Brunner defended the government’s approach in the Club of Economic Journalists on Monday, APA reported.
“Inflation continues to be way too high, no question about it,” Brunner added. “Our job is to support, we have done that massively.” Inflation-tackling measures must always be balanced between accuracy, speed and social compensation.
According to Brunner, the possibility for accurate measures was not always sufficiently given, as necessary data interfaces were often lacking. He stressed that he hoped for improvements in the future, while measures to combat inflation would have always been coordinated with experts.
Other countries with lower inflation than Austria would face problems in other areas, such as Spain and France, which would have suffered significant losses in average household income, while the one of Austria has risen slightly, he said.
No country in the world currently has “low inflation, high household income, high growth and a balanced budget”, Brunner continued, adding that it would be important to normalise the budget in the coming years.
On the high inflation issue, far-right FPÖ Secretary General Michael Schnedlitz criticised the conservative-Green government currently in power for still having not yet found the “suitable answers” to high inflation in a press release on Monday.
Schnedlitz recommended the government to take Portugal as an example, which is temporarily scrapping VAT on 44 essential food products.
(Chiara Swaton | EURACTIV.de)
Source: euractiv.com
